EXHIBIT 4.29.1
FIRST AMENDED
VALUESTAR CORPORATION
INVESTORS RIGHTS AGREEMENT
THIS FIRST AMENDED INVESTORS RIGHTS AGREEMENT (this "Amendment") is
dated effective as of March 24, 2000, by and among VALUESTAR CORPORATION, a
Colorado corporation (the "Company"), SEACOAST CAPITAL PARTNERS LIMITED
PARTNERSHIP, a Delaware Limited Partnership ("Seacoast"), PACIFIC MEZZANINE
FUND, L.P. a California limited partnership ("Pacific"), TANGENT GROWTH FUND,
L.P., a California limited partnership ("Tangent"), eCOMPANIES VENTURE GROUP,
L.P., a Delaware limited partnership ("eCompanies") and TMCT VENTURES, L.P.
("TMCT") (each a "holder" and, collectively, the "holders") and the entities or
individuals set forth on Schedule 1 attached hereto and incorporated herein by
reference as may be amended from time to time (the "Securities Holders") to
reflect all parties who comprise holders of the "Securities" held by all
"Purchasers" under that certain Securities Purchase Agreement dated for
reference purposes only on even date herewith (the "Securities Purchase
Agreement").
RECITALS
A. On December 8, 1999, Seacoast, Pacific and Tangent, among other
parties thereto, entered into an Investors Rights Agreement with the Company as
amended on January 4, 2000, with the addition of TMCT as a party thereto (the
"Rights Agreement"), whereby such agreement granted certain preemptive rights
and registration rights to the Holders.
B. In consideration of the Company's sale of certain securities in
accordance with the terms and provisions set forth under the Securities Purchase
Agreement dated on even date herewith (the "Securities") the Holders desire to
amend the Rights Agreement in accordance with the terms set forth in this
Amendment. All Capitalized terms not defined herein shall have the meanings
established in the Rights Agreement or identified in the Rights Agreement.
AGREEMENT
NOW, THEREFORE, in consideration of the mutual agreements, covenants,
representations and warranties contained in this Amendment, the parties hereto
hereby agree as follows:
1. Registration Rights.
a. Incidental Registration. Solely for purposes of Section 2.b
of the Rights Agreement (piggyback registration rights) and any other provision
under Section 2 of the Rights Agreement applicable thereto, including but not
limited to Sections 2.e, 2.m and 2.n (but specifically excluding Sections 2.a,
2.c, and 2.k), the Holders hereby agree and give their consent
as required under Section 2.k of the Rights Agreement that the definition of
Registrable Securities for purposes of Section 2.b shall include the "Shares,"
"Warrants" and "Warrant Shares" as such terms are defined under the Securities
Purchase Agreement and the definition of "holder" for purposes of Section 2.b
shall include the Securities Holders. Notwithstanding the foregoing, the
Securities Holders shall be entitled to notice under Sections 2.a and 2.c and to
participate in such registrations as if they were the Holders of Registrable
Securities thereunder with respect to their Shares, Warrants and Warrant Shares.
In no event will a Securities Holder be required to exercise his Warrants as a
condition to the registration of such Warrant or Warrant Shares thereunder.
b. Termination/Rule 144 Availability. Notwithstanding the
foregoing, the Company will not be obligated to register any of the Securities
Holders' Registrable Securities (i) if counsel reasonably acceptable to a
majority in interest of the Holders renders an opinion in form and substance
satisfactory to such Holders to the effect that such Registrable Securities are
freely saleable without limitation as to volume under Rule 144 under the
Securities Act of 1933, as amended or (ii) after the fifth anniversary date of
the earlier to occur of a "Qualified Liquidity Milestone" or "Qualified
Liquidation Event."
c. Holdback Agreements. In connection with any underwritten
public offering, each Securities Holder of Registrable Securities agrees, if so
required by the managing underwriter, not to effect any public sale or
distribution of Registrable Securities (other than as part of such underwritten
public offering) during the period beginning seven (7) days prior to the
effective date of such registration statement and ending on the one hundred
eightieth (180th) day after the effective date of such registration statement;
provided, however, that (i) Xxx Xxxxx and each Person that is an officer,
director, or beneficial owner of five percent (5%) or more of the outstanding
shares of any class of Capital Stock enters into such an agreement, and (ii)
each Holder and Securities Holder shall be proportionately cutback only in
accordance with the provisions of Section 2.b of the Rights Agreement.
2. Waiver of Preemptive Rights. Each of the Holders hereby waives its
preemptive rights set forth in Section 3 of the Rights Agreement applicable to
any of the securities sold or to be sold under the Purchase Agreement.
3. Miscellaneous.
a. Headings. The headings in this Amendment are for
convenience and reference only and are not part of the substance of this
Amendment.
b. Severability. The parties to this Amendment expressly agree
that it is not their intention to violate any public policy, statutory or common
law rules, regulations, or decisions of any governmental or regulatory body. If
any provision of this Amendment is judicially or administratively interpreted or
construed as being in violation of any such policy, rule, regulation, or
decision, the provision, section, sentence, word, clause, or combination thereof
causing such violation will be inoperative (and in lieu thereof there will be
inserted such provision, sentence, word, clause, or combination thereof as may
be valid and consistent with the intent of the parties under this Amendment) and
the remainder of this Amendment, as amended, will remain binding upon the
parties to this Amendment, unless the inoperative provision would cause
enforcement of the remainder of this Amendment to be inequitable under the
circumstances.
c. Notices. Whenever it is provided herein that any notice,
demand, request, consent, approval, declaration, or other communication be given
to or served upon any of the parties by another, such notice, demand, request,
consent, approval, declaration, or other communication will be in writing and
will be deemed to have been validly served, given, or delivered (and "the date
of such notice" or words of similar effect will mean the date) five (5) days
after deposit in the United States mails, certified mail, return receipt
requested, with proper postage prepaid, or upon receipt thereof (whether by
non-certified mail, telecopy, telegram, express delivery, or otherwise),
whichever is earlier, and addressed to the party to be notified as follows:
If to the Company, at ValueStar Corporation
000 00xx Xxxxxx, Xxxxx 000
Xxxxxxx, XX 00000
FAX: (000) 000-0000
Attention: Xxx Xxxxx
with courtesy copies to: Bay Venture Counsel, LLP
0000 Xxxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxx, Esq.
Fax: (000) 000-0000
If to any
Securities Holder: As set forth on Schedule 1 to the
Securities Purchase Agreement.
or to such other address as each party may designate for itself by
like notice. Notice to any other Holder will be delivered as set forth above to
the address shown on the stock transfer books of the Company unless such Holder
has advised the Company in writing of a different
address to which notices are to be sent under this Amendment. Failure or delay
in delivering the courtesy copies of any notice, demand, request, consent,
approval, declaration, or other communication to the persons designated above to
receive copies of the actual notice will in no way adversely affect the
effectiveness of such notice, demand, request, consent, approval, declaration,
or other communication. No notice, demand, request, consent, approval,
declaration, or other communication will be deemed to have been given or
received unless and until it sets forth all items of information required to be
set forth therein pursuant to the terms of this Amendment.
d. Successors/Amendments. This Amendment will be binding upon
and inure to the benefit of the parties and their respective successors and
permitted assigns. Except as otherwise expressly provided herein, the provisions
of this Amendment may be amended and the Company may take any action herein
prohibited, or omit to perform any act herein required to be performed by it,
only if it has obtained the written consent of Holders holding at least
sixty-six and two-thirds percent (66-2/3%) or more of the then outstanding
Registrable Securities; provided, however, that any amendment or action which
would adversely affect only one class of Holders shall also require the written
consent of the Holders holding at least sixty-six and two-thirds percent
(66-2/3%) or more of the then outstanding Registrable Securities of such class.
Notwithstanding the foregoing, this Section 3.d. shall not be amended without
the consent of all Holders.
e. Remedies. The failure of any party to enforce any right or
remedy under this agreement, or to enforce any such right or remedy promptly,
will not constitute a waiver thereof, nor give rise to any estoppel against such
party, nor excuse any other party from its obligations under this Amendment. Any
waiver of any such right or remedy by any party must be in writing and signed by
the party against which such waiver is sought to be enforced.
f. Counterparts. This Amendment may be executed in any number
of counterparts, which will individually and collectively constitute one
agreement.
g. Choice of Law. THIS AMENDMENT HAS BEEN EXECUTED, DELIVERED,
AND ACCEPTED BY THE PARTIES AND WILL BE DEEMED TO HAVE BEEN MADE IN THE STATE OF
CALIFORNIA AND WILL BE INTERPRETED AND THE RIGHTS OF THE PARTIES DETERMINED IN
ACCORDANCE WITH THE LAWS OF THE UNITED STATES APPLICABLE THERETO AND THE
INTERNAL LAWS OF THE STATE OF CALIFORNIA
APPLICABLE TO AN AGREEMENT EXECUTED, DELIVERED AND PERFORMED THEREIN WITHOUT
GIVING EFFECT TO THE CHOICE-OF-LAW RULES THEREOF OR ANY OTHER PRINCIPLE THAT
COULD REQUIRE THE APPLICATION OF THE SUBSTANTIVE LAW OF ANY OTHER JURISDICTION.
Corporation Investors Rights Agreement Signature Pages to First Amended
ValueStar
IN WITNESS WHEREOF, the parties have executed and delivered this
Amendment as of the date first above written.
COMPANY:
VALUESTAR CORPORATION
By: /s/ XXXXX XXXXX
Name: Xxxxx X. Xxxxx
Its: President and Chief Executive Officer
eCOMPANIES VENTURE GROUP, L.P.
By:
Name: Xxxxxx Xxxxxx
Its: Managing General Partner
SEACOAST CAPITAL PARTNERS LIMITED
PARTNERSHIP
By: Seacoast Advisors, LLC,
A Delaware limited liability company
By: /s/ XXXXXXX X. XXXXXXX
Name: Xxxxxxx X. Xxxxxxx
Its: Member & Manager
PACIFIC MEZZANINE FUND, L.P.
By: Pacific Private Capital
its general partner
By: /s/ XXXXXX X. XXXXX
Name: Xxxxxx X. Xxxxx
Its: General Partner
TANGENT GROWTH FUND, L.P.
By: Tangent Fund Management, LLC
its general partner
By: /s/ XXXX X. XXXXXX
Name: Xxxx X. Xxxxxx
Its: Vice President
Corporation Investors Rights Agreement Signature Pages to First Amended
ValueStar
TMCT VENTURES, L.P.
Under management by Rustic Canyon Partners,
LLC
By: /s/ XXXXXXX SONG
Name: Xxxxxxx Song
Title: Partner, TMCT Ventures
Schedule 1
(Individual Pages Differ as to Holder's Name and Personal Information)
SECURITIES HOLDERS
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Name of Holder
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Authorized Signature
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Print Name and Title of Signatory
